1. (Limited) replacement cost coverage for all: 2 years or 40,000 km

Is your car less than two years old? Does it have less than 40,000 km on the odometer? Your auto insurance policy has a clause sharing common features with a replacement cost endorsement. The insurer will calculate the claim amount based on the cost of Original Equipment Manufacturer parts. That only applies to body parts, however.*

2. What’s in a name

Everyone calls it a replacement cost endorsement, so you may be wondering why you don't see that anywhere on your insurance policy. Well, the answer is simply because the replacement cost endorsement is actually called the Quebec Endorsement Form (Q.E.F.) No. 43 – Change to indemnity. Why make it simple?

3. When you think replacement cost endorsement, think options

Replacement cost is a protection that features six options – and various sub-options – including some that cover partial loss (options 43A and 43B) and some that cover total loss (43C, 43D, 43E and 43F). When you purchase replacement cost coverage, you have to select one or more options. Important: Depending on the options you have chosen, your indemnity may be limited to the price you paid for your vehicle, even if the same vehicle currently sells for more.

There is also replacement insurance (Q.P.F. No. 5 Replacement Insurance for automobiles and recreational vehicles), which may resemble to the replacement cost endorsement but that is in fact very different. If in doubt, talk to your insurance agent, a qualified professional who has been trained to advise you effectively.

4. Leasing your car? Don’t rule out replacement cost coverage!

If you are leasing your car, you might think that getting replacement cost coverage is not really worth it. After all, you don’t own the car, do you? Consider this, however. Some dealers will want you to fix that dent you’ve forgotten about and nothing forces them to accept anything but new, Original Equipment Manufacturer parts.

And did you know this? In the event of total loss after three years, the lessor is entitled only to the value of the car at the time of the loss, whereas you are entitled to the difference between the value of the car at the time of the loss (used value) and the replacement cost. Enough for a nice big deposit on your next lease to lower your monthly payments!

Do you have questions about your protections? Call Customer Service to talk to one of our insurance agents.


* For commercial vehicles, the limit is one year. The insurer will use the cost of Original Equipment Manufacturer parts to calculate the claim amount, but in some cases, depreciation may apply at the same rate as for the damaged parts.

Legal note